Below is a copy of the transcript from the Local Finance Board meeting of September 10, 2008 regarding the City of Hoboken. NEW JERSEY LOCAL FINANCE BOARD 2 * * * * 3 Wednesday, September 10, 2008 4 Trenton, New Jersey 5 * * * * BOARD MEMBERS PRESENT: 6 SUSAN JACOBUCCI, Chairwoman PATRICIA PARKIN McNAMARA, Executive 7 Secretary FRANCIS BLEE 8 LIZETTE DELGADO TED LIGHT 9 RICHARD F. TURNER SUSAN BASS-LEVIN 10 PRESENT: 11 DANIEL P. REYNOLDS, Deputy Attorney General 12 TINA ZAPIZCHI 13 HELD AT: 101 South Broad Street Trenton , New Jersey 14 REPORTED BY: 15 Renee Helmar, Shorthand Reporter 16 * * * * MADAME CHAIRWOMAN: The first item on our 7 agenda, today, is the City of Hoboken that, 8 under NJSA 52:27BB-54 et seq., Proposed 9 Supervision Act. 10 This started in -- actually, it started in 11 May 2008, and July 2008, the Local Finance 12 Board initiated the action and filed a 13 complaint against the City of Hoboken seeking a 14 judicial termination pursuant to NJSA

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15 52:27BB-55(6) regarding the proposal of the 16 city to comply with the contingent of the local 17 budget NJSA 48:4-106, substantially 18 jeopardizing the fiscal integrity of the city. 19 The obligation included, but not limited 20 to this area, to adopt a budget within this 21 time frame established by law in contravention 22 of a direct order of this director. 23 It went to court and a consent order was 24 entered by Judge Gallipoli on August 14th, 25 2008. 0003 1 Under the consent order, it is agreed as 2 follows: to determine the conditions set forth 3 in NJSA 52:27BB-55(6) currently exists in the 4 City of Hoboken , specifically, the gross 5 enterprise and the City comply with the 6 decision of the local budget law, and 7 substantially jeopardizes the fiscal integrity 8 of the city. 9 The director shall inform the Board of the 10 City's cooperation in agreeing to this consent 11 order and the need of a hearing on this. 12 The director acknowledges that the City's 13 action as a positive in establishing the City's 14 fiscal financial stability, and will give it 15 whatever weight I deem is appropriate in 16 determining future actions regarding this 17 matter. 18 Each party shall bear its own cost. 19 So, we have the consent order. You come 20 before the Board under this statute, and before 21 I make my recommendations regarding the 22 parameters of the supervision -- I see that I 23 have six people here today, five or six people 24 here today. I will give you a brief time. 25 MR. REYNOLDS: If I may take 50 seconds to 0004 1 review the procedure. 2 The condition of termination having been 3 read, and the status of consent order to be 4 determined, and whether the city should be put 5 under the Board's supervision, and if so, the 6 specific measures supervising this Board may 7 deem appropriate to put in place in the city. 8 Assuming that the Board decides to place

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9 the superimposed statute, the Board's action 10 goes into effect after it has been approved by 11 two or three Cabinet Officers, the Cabinet 12 Officers through the Department of Community 13 Affairs, the State Treasurer and the Attorney 14 General. 15 Traditionally, under the statute, the 16 Board's supervision will be in existence for 17 one year. It can be extended past one year, 18 but only with another hearing, another Board's 19 motion extending for a period of a year. 20 If the Board decides to extend the hearing 21 for another year, the approval of two or three 22 Cabinet Officers be required. 23 MADAME CHAIRWOMAN: Okay. So I will start 24 with you, Mayor Roberts. 25 MAYOR ROBERTS: Good morning, Commissioner 0005 1 and members of the Board. 2 We are here today to extend our 3 appreciation that the Local Finance Board who 4 is going to extend itself some capacity in the 5 City of Hoboken . 6 As many of you know, Hoboken is a very 7 interesting city. It is a city with much to be 8 grateful for and much success. 9 Later today, one of the more interesting 10 aspects of Hoboken is, today, at 10:00 a.m., 11 we're before the Local Finance Board having the 12 Board involve itself, and the State of New 13 Jersey involving itself, in the finance of our 14 city, because of the inability of mayor/council 15 adopting a budget. 16 Later in the same day, at 11:40 this 17 morning, I have been invited over at New Jersey 18 PAC to talk about the great successes of 19 Hoboken . The great economy that Hoboken has, 20 the great milestone that we have succumb as a 21 municipality. 22 It is hard to imagine that Hoboken , with a 23 city of under 50,000 people, having encountered 24 as much success as we've encountered, it is 25 regrettable, and I underscore regrettable, that 0006 1 we are here today. 2 When -- I just want to go on the record

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3 and extend a couple of facts so that later in 4 the day, there be no ambiguity. 5 You may hear about spending, that Hoboken 6 is out of control. But we did a very detailed 7 report, forwarded to your office. 8 Discretionary spending in 2001, in 9 Hoboken , was just at $9 million; discretionary 10 spending. The spending that the mayor's office 11 and council have some demonstrative impact 12 over. 13 Today's discretionary spending is at eight 14 million. It is one million less than it was 15 seven years ago. 16 The spending that we're talking about as 17 it relates to increases in the budget after the 18 audit was given, the budget has gone from -- in 19 the 50s, 57 million after audited, to low 90s. 20 How did that increase occur? Well, if you 21 look at every major city in the country, you 22 will find public safety increases, pension cost 23 increases, health care cost increases, other 24 obligation increases. And may I underscore, 25 they were all voted on by members of the 0007 1 governing body. 2 So, discretionary spending has actually 3 gone down. 4 Municipal taxes in Hoboken , because of 5 close adherence to our economic develop plans 6 that we set forth seven years ago, we have 7 increased the amount of reoccurring revenue 8 within the city in a very sizeable way. 9 The value of Hoboken without the benefit 10 of a revalue has gone from $2.8 billion, to 11 just over $9 billion in the course of a 12 seven-and-a-half year period. That's 13 extraordinary. 14 We are a city that is blessed with 15 opportunity; we are a city that is blessed with 16 the ability to attract business, and we have a 17 young community that loves Hoboken . 18 This -- this problem of -- I was here four 19 years ago. We have, in our city, as in many 20 cities across the country and in the state, 21 politics plays a roll in our system of 22 government. I am aware of that.

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23 But everything in life is okay in 24 moderation. 25 I have to say, being unable to come to 0008 1 terms with our adversaries, being unable to 2 meet in a setting like this to say, let's solve 3 our budget difficulties. 4 The budget presented to the Municipal 5 Council was incorrect. It was wrong. It was 6 lost. It was a sizeable mistake that was 7 uncovered. But the actions of what we all did 8 as a result of that mistake is very telling. 9 There was 16 ideas presented to the 10 Municipal Council two months ago. 15 have, 11 either, been tabled or rejected. 12 There are no fewer than four members of 13 the governing body running for mayor. 14 It is a city that has succumbed. It is 15 not a political setting like in any other 16 American city; politics plays a role in it. 17 For heaven's sake, I also did. 18 But we are at a point now, where the 19 politics of the moment, and I honestly say 20 that, has overcome better judgment. I have 21 overcome the spirt of compromise. Has overcome 22 where we would always meet and say, look, let's 23 just pass the budget. I will do this; 24 Municipal Council will do that. We were at a 25 complete impasse. 0009 1 And in conclusion, the Municipal Council, 2 after being ordered by the director, still 3 refused to pass a municipal budget. Fined 4 individually. Still refused to pass a 5 municipal budget. 6 I would only hope that after today, and I 7 stand here embarrassed, I stand here with a 8 sense of disgust and responsibility -- and 9 responsibility, because my days as a 10 firefighter and promotional commands, you could 11 delegate authority, but you could not delegate 12 responsibility. 13 So, for those folks that wanted to bring 14 about shame, wanted to bring about this moment 15 of Apocalypse, they've succeeded. That is part 16 of life. I have to accept that, but I am

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17 willing to work with the state; I am willing to 18 work with every council person; I am -- I am 19 happy that the State of New Jersey intervened 20 at a time when we could have had a catastrophic 21 increase in taxes. 22 So, I want to thank the Director; I want 23 to thank the members of the Local Finance 24 Board. And I want you to know that I will work 25 with you. And I will do whatever it takes to 0010 1 get the city's finances back in a position that 2 we could all be proud of, that mentor, the 3 great City of Hoboken . 4 Thank you very much, Director. 5 MADAME CHAIRWOMAN: Thank you, Mayor. 6 Council Cunningham. 7 MR. CUNNINGHAM: Thank you. 8 These are my comments and not necessarily 9 the comments of -- or the, you know, the same 10 ideals of my colleagues or the administration. 11 State supervision is, you know, obviously 12 an unfortunate event that has affected this 13 municipality and many others in New Jersey , and 14 kind of goes to those municipalities and their 15 inability to get their financial matters under 16 control. 17 The question is, how did we get here? 18 I just finished up my first year as an 19 elected official, and as I think you even 20 mentioned in your complaint, this has been 21 going on in Hoboken for well over five or six 22 years. 23 The way that I look at it, I see this as, 24 you know, years of fiscal mismanagement due to, 25 in part, lack of proper policies and procedures 0011 1 at the director level. 2 I am not going to sit here and talk about 3 the spending and the analysis that the mayor's 4 office has done, that would indicate that it 5 hasn't been out of control when there has been 6 other financial analysis done, that would show 7 to the contrary. 8 I am here to tell you today, that under 9 certain conditions as future expected results, 10 I do welcome the State supervision and the

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11 appointment of a monitor that will come in and 12 actually take a look at how we actually run the 13 city government. 14 I have had discussions with some of the 15 people, here, at the Local Finance Board, that 16 have indicated that those kinds of services are 17 available. And I have to tell you, the 18 taxpayers of Hoboken , as well as the State of 19 New Jersey , will be watching and expecting a 20 lot from the Local Finance Board and the 21 Division of Community Affairs, and how they are 22 going to help us get out of this and correct 23 this financial situation that we're in. 24 When I look at 80 percent of our budget as 25 salary, and 50 percent of that is attributed to 0012 1 public safety, I think that would probably be a 2 good place for a fiscal monitor and the tools 3 that are available at the Local Finance Board, 4 to start. 5 Given the State's track record, and you 6 can understand there is a lot of skepticism, 7 not only at the taxpayer level and overall 8 throughout the state, we are concerned that, 9 perhaps you won't be able to get the job done. 10 But I am hopeful. 11 I am hopeful in that, I have seen it 12 effectual in Hamilton recently, and what you 13 have been able to do in Camden the last couple 14 of years, and I want to work in a collaborative 15 effort with the administration and my council 16 colleagues to see this city move forward. 17 It is time for us to thoroughly review the 18 departments from Public Safety, to the parking 19 utility, to create efficiencies and employ new 20 methods of technology and, also, assist us in 21 effectively managing our collective bargaining 22 agreement. 23 I think that, that is where we have fallen 24 in the last seven years. 25 So, the city and the state taxpayers, we 0013 1 will be watching. 2 Hoboken has been the first for many 3 things, and let's make Hoboken a perfect 4 example of the way our state can work with the

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5 city in bringing forth these policy changes. 6 Help us get the job done, and let's not 7 disappoint. 8 Thank you for your time, and looking 9 forward to working with you. 10 MADAME CHAIRWOMAN: Thank you, Councilman. 11 Councilwoman Zimmer. 12 MS. ZIMMER: Thank you very much. 13 My name is Dawn Zimmer and I am 14 councilwoman representing the fourth Ward. I 15 asked to have the opportunity to speak to you 16 today. 17 As we all know, last month New Jersey 18 Superior Court made a determination that there 19 was a gross failure on the part of the City of 20 Hoboken to comply with the conditions of the 21 local budget law which, substantially, 22 jeopardizes the integrity of the City of 23 Hoboken . 24 The courts have stated the obvious. 25 Nobody who has been paying attention for the 0014 1 past several months can tell us how we feel. 2 A mayor overspends and introduced budget 3 by more than 10 million, and tried to hide this 4 by not paying our bills. A practice that has 5 apparently been going on for years. It is hard 6 to imagine a better chance for the state to 7 come in. 8 As a member of the Hoboken City Council, I 9 accept my share of the blame. We have all 10 taken important powers and responsibilities of 11 the council. 12 Every year, our city council has failed to 13 exercise their own powers and responsibilities, 14 acting, instead, as a rubber stamp for the 15 mayor and his administration. 16 In the past year, my colleagues and I have 17 tried to step up to the plate and do the jobs 18 that we were elected to do. 19 We tried to exercise the kinds of checks 20 and balances on the mayor that we are supposed 21 to do. 22 The past council simply acted as the 23 mayor's rubber stamp, and had no intention to 24 follow, and we were left trying to invent the

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25 wheel. 0015 1 We had no intention to follow, we often 2 found ourselves paralyzed doing more talking 3 than acting. 4 Hoboken needs to institutionalize this 5 control, to make sure that we not only fix this 6 debacle, but also ensure that it never happens 7 again. 8 Our problems are the result of all the 9 spending, not undertaxing. 10 The solution must start with spending 11 less, not taxing more. 12 At the end of the day, it is very possible 13 that a responsible solution will include a tax 14 increase, as well as increase to use some 15 government services. But those steps must come 16 at the end of the day, not at the beginning. 17 Our existing crisis is only a symptom, not 18 the disease itself. 19 I look forward to working with all of you 20 on behalf of the citizens of my ward and 21 Hoboken , to ensure that we cure the disease and 22 immerge with a healthy, financially strong city 23 that our city deserves. 24 Thank you. 25 MADAME CHAIRWOMAN: Thank you, 0016 1 councilwoman. 2 Councilwoman Mason. 3 MS. MASON: Commissioners, I believe you 4 know my name is Elizabeth Mason. I am a 5 business owner in the City of Hoboken . 6 As my of you are aware, I have been here 7 numerous times before as a private, and most 8 recently as an elected official. And I am, 9 unfortunately, disheartened that I have to be 10 here again. 11 My position on the matter before you, as 12 well as others, has lead us to have to preface 13 what has been expressed here in the public form 14 in the past. 15 I believe in the democratic process that 16 in the city council that the people were 17 elected to represent. 18 And I have a brief, four-paragraph letter

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19 that I will submit for the record. 20 "Dear Director Jacobucci and 21 Commissioners: I would like to thank you for 22 allowing me to place my objections to the 23 possible State takeover of the City of Hoboken 24 on the record. 25 First and foremost, our city is an 0017 1 intelligent, vibrant and pro-active community 2 that has the ability to work to fix the 3 financial, operational and legal matters that 4 Hoboken currently faces. 5 These efforts are evidenced by the fact 6 that over at least the past five years, 7 concerned residents of the City of Hoboken have 8 attempted to raise awareness among the 9 community, the courts, regulators, and even to 10 advise this Board of financial, operational and 11 legal failures regarding our city and offer 12 solutions. 13 The 2008 municipal budget continued to 14 contain the long-standing structural deficit, 15 and unbeknownst to the City Council and this 16 body, was overspent by more than $10 million. 17 Hoboken 's financial advisers, the firm of 18 Donahue, Gironda and Doria were brought in more 19 than three years ago to address the city's 20 financial staffing needs. 21 Given the situation, one must raise the 22 question of why the numerous financial and 23 procedural failures were not brought to light 24 sooner. 25 In addition to these alarming and 0018 1 financial discoveries, significant issues have 2 come to light in various departments such as 3 the Public Safety as it relates to the SWAT 4 investigation, the Hoboken Building Department, 5 the Hoboken Parking Utility, some of our 6 municipal boards and authorities and other 7 critical operational and legal failures that 8 have been governmentally suppressed over the 9 past several years. Clearly, our city needs to 10 explore another possibility to resolve these 11 extensive problems. 12 The obvious solution, as was initiated by

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13 me several months ago, is to engage in an open 14 selection process that will allow the Hoboken 15 City Council, now with your assistance, to 16 issue a request for qualifications similar to 17 what was drafted in June, and retain an 18 independent financial restructuring firm with 19 expertise and a proven track record in 20 resolving complex operational and financial 21 matters such as these. 22 This approach is the only way to help the 23 City of Hoboken identify and resolve its 24 financial, operational and legal matters and 25 begin to reestablish the citizens' and 0019 1 businesses' trust in, not only our city, but in 2 our state government. We have been trying 3 half-baked solutions for far too long. 4 I voted against an underfunded budget, and 5 I never voted to bring in the state to take 6 over to address this very significant and real 7 challenge the City of Hoboken faces. 8 Should you elect to assign a 9 representative to work on your behalf with the 10 City of Hoboken , I look forward to helping the 11 members of the Board and the assigned 12 individual keep the process open and inclusive 13 to the people of Hoboken . 14 Without it, government becomes all 15 powerful, and in the words of U.S. Appellate 16 Court Judge Damon Keith, 'Democracy dies behind 17 closed doors, and the people's ability to 18 govern themselves dies with it.' 19 This statement never resonated more than 20 it does today." 21 Thank you for your time. 22 MADAME CHAIRWOMAN: Thank you 23 councilwoman. 24 Mr. DeGornaro. 25 MR. DeGORNARO: Lawrence DeGornaro, 0020 1 Hoboken resident, taxpayer and a consultant to 2 the city. 3 I am here just to -- not to embarrass 4 anyone, or the City of Hoboken , I am here to 5 just make sure that the -- that this doesn't 6 happen again, that the State does intervene.

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7 And I appreciate the City coming in. 8 I didn't look forward to seeing this. I 9 believe that the council and the mayor should 10 have worked closely together and avoided 11 something like this. 12 I want to make sure that the city does not 13 exceed the $11 million the way that they did in 14 the past. 15 This is crazy. It is a mile square city. 16 I am not really concerned with how much we 17 are rated on -- in billions of dollars and so 18 on. But I am concerned about is, I was brought 19 up in a time when you have to earn your credit 20 and live within your means and so on. 21 This city has gotten out of hand. It is 22 due to politics, and it is also due to just 23 loading up the payroll contingencies. 24 We can't afford this. There is a time 25 when people have to say, we have to layoff. 0021 1 I'm sorry, but we cannot carry this. This is 2 done in private business. 3 I think the city has to start acting like 4 the private business does. I don't think they 5 have to be as severe, but I think that we have 6 to start opening our eyes. 7 Public Safety says, oh, well, we got to 8 make sure that the public safety is always 9 first and foremost. 10 However, the Public Safety has gotten out 11 of hand tremendously. The governor and the 12 rest of the state has recognized this. The 13 pension brackets and everything else. 14 We have to start acting a little bit like 15 a business. 16 I am glad the State is coming in at this 17 particular point, because it's gotten out of 18 hand. 19 I offer my services in any way. And I am 20 not politically inclined with anyone here, the 21 mayor or any other councilperson. I spoke for 22 the citizens of Hoboken , and that's what I am 23 hoping I'm speaking today. 24 Thank you for allowing me to talk and 25 listening to us as individuals. 0022

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1 MADAME CHAIRWOMAN: Thank you, Mr. 2 DeGornaro. 3 And Miss Hirsch. 4 MS. HIRSCH: Hi. I am not a public 5 representative, I'm an old woman who's learned 6 the hard way what a nickel is worth. 7 I have been going to council meetings for 8 10 years and tried to figure out what was going 9 on. 10 What I have written here, I feel very 11 strongly about. You and New Jersey are on 12 trial today. People are watching to see 13 whether you honor and -- I can't even read my 14 own writing -- and support the rule of law. 15 Whether you honor your pledge -- oath to 16 serve your constituents, me or continue to go 17 along with whatever mischief other members of 18 your club create, Hoboken and New Jersey are 19 already under scrutiny. 20 Public officials from New Jersey , north 21 and south, are in the headlines almost daily. 22 Something is wrong. High taxes, corruption, 23 are they connected? 24 If I had my way, I would find a skilled, 25 totally independent person from outside of the 0023 1 state and keep that person in place until every 2 scrape of paper with a number on it has 3 undergone critical scrutiny. 4 I would instruct that person to clear the 5 $12 million overdraft in the present fiscal 6 year. Any avoidance that the taxpayer would be 7 first on avoidances. Why weren't the taxpayers 8 considered when the indiscretions were 9 committed? 10 Too, Hoboken needs all the revenue that it 11 can find. The municipal garage sale was sold 12 -- when the municipal garage was sold, and the 13 owners of it, the dollars aren't available. 14 The sale was a wash. But I am not speaking -- 15 it must be replaced, and the list goes on. 16 David Roberts has already declared this 17 for the democratic process; he must be honest. 18 And I think that says the whole thing. 19 Somebody must take over and set the entire 20 system back on track. It is way off track.

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21 Monies are collected for senior services, 22 but I am the wrong senior. I happen to pay my 23 taxes and live independently. I get no 24 services. Why? Because I am not susceptible 25 to brainwashing and vote instruction. I get 0024 1 nothing for my tax dollar. 2 I don't get police service. So far, I 3 haven't needed fire service, but I see what's 4 going on around me. 5 The other day I saw something in a park in 6 town and I desperately, desperately needed to 7 speak with a police person. I saw a car 8 revving; I looked around; I found no one. I 9 was on my scooter at the time, and I traveled 10 15 minutes from that spot, slowly up and down, 11 looking for a policeman. I found none. And 12 this was a reintegration of the local patrol. 13 Where are they? Yes, I see them, because 14 I live across the street from a favorite diner, 15 and I see three or four squad cars parked at 16 that corner blocking intersections and 17 crossings. I have to drive around them on my 18 scooter when they're getting their lunch. 19 We have a tremendous public safety budget. 20 What happened to it? Are there too many chiefs 21 and not enough soldiers; not enough crew? 22 Something is wrong. Something is very much 23 wrong. 24 I pay about three times as much in taxes 25 for a two-bedroom apartment as the mayor does 0025 1 for a wide brownstone. I don't know how many 2 apartments are in it. Three times as much. 3 A revalue would hurt the old people. But 4 they're getting services, which I am not 5 getting. Something is very much structurally 6 wrong, that is why they should find an 7 independent out-of-state person that will 8 really examine every book in town, every piece 9 of paper with a dollar sign on it, every 10 office. 11 We have too many people who have jobs for 12 which they are not qualified, but they hire 13 consultants. Our consultant bills are 14 outrageous. And in addition to consultants, we

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15 have a PR person. The directors can't speak 16 for themselves, they need someone to spoke for 17 them. 18 The Board of Education needs PR people. 19 The context of building a better mousetrap to 20 attract people to your door does not exist in 21 Hoboken . We have to sell ourselves. The 22 hospital has to sell itself directly or 23 otherwise. 24 The Board of Education has to sell itself. 25 Why? A good product doesn't have to be sold. 0026 1 A good product sells itself. And all the PR in 2 the world will not sell any bad place. 3 MADAME CHAIRWOMAN: I would ask you to 4 windup now. 5 MS. HIRSCH: Okay. I am finished. Thank 6 you. 7 MADAME CHAIRWOMAN: Thank you very much. 8 What I am going to do now is, I am going 9 to make a statement, and then I will ask the 10 Board if they will place Hoboken under State 11 supervision, and I will outline the plan. 12 First of all, I have listened to 13 everything that you said, and I wanted to 14 assure you that this Board has a commitment, 15 both, to the state and to the residents of 16 Hoboken . 17 I hear a lot of going back and forth 18 between the mayor and council. We've dealt 19 with them for a long time, and extended from 20 before May of 2008. 21 But in reality, in my opinion, there is no 22 reason that Hoboken should even be here today. 23 You are not like one of our special cities 24 that you can use state money in order to just 25 provide essential services. 0027 1 As the mayor stated and city council 2 stated, Hoboken is, and should be, a vibrant 3 city. 4 But because of inactions of elected 5 officials, and I'm not pointing a finger at 6 anyone, we have come to this state today. 7 It is a sad state of affairs when a city 8 like Hoboken can't even pass a budget. A

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9 budget that was presented in October or 10 November of 2007. 11 I want to assure everybody here today, 12 mayor, council, residents and the press that is 13 here, that this is not a takeover. It is not a 14 takeover. It is a state supervision provided 15 by statute. 16 The mayor and council will still be 17 expected to complete all their statutory duties 18 and run the city. That is what we have been 19 saying for the past 10 months. But it hasn't 20 come to pass. 21 And I wanted to assure Mr. DeGornaro that 22 all these processes will be transparent, 23 because the only people that the mayor and 24 council has failed, and I heard the statements, 25 are the residents of Hoboken . 0028 1 Because that is what we are here for 2 today, is to make sure that the residents of 3 Hoboken know what the processes are, know that 4 it is going to be transparent and know that the 5 mayor and council will fulfill their duties, 6 and the state supervision will help them in 7 doing that. 8 Under the statute, state supervision is 9 for one year. One year from today's -- of this 10 meeting if it is approved by this Board. 11 That, in essence, there is two budgets for 12 the city, the present budget and the next 13 fiscal budget. 14 If, for some reason, there needs to be an 15 extension of that, you will come back before 16 this Board, and the Board will make the 17 decision. 18 So, my first recommendation to the Board 19 is that we do take Hoboken under state 20 supervision, under the provisions of the Local 21 Government Supervision Act. 22 And what I recommend the parameters that 23 must be placed under this supervision is; one, 24 that the preparation of adoption of said, that 25 the Board has control over the preparation and 0029 1 adoption of the municipal annual budget. 2 It doesn't mean that the mayor, council --

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3 the mayor is to prepare the budget, which I've 4 heard that he's already done. It doesn't mean 5 that the council is not empowered to pass the 6 budget. 7 We are not taking away your statutory 8 power. 9 However, the Board and the Division of 10 Local Government Services, as authorized by the 11 Board, will make sure that the process is 12 completed in a timely manner. 13 And that the input from the council and 14 from the mayor and from the residents is heard. 15 I also recommend approval by the director 16 of all contracts in excess of $4500, approval 17 by the Board of all bondages and other 18 obligations of the municipality. Approval by 19 the director of all appropriations and 20 expenditures of the municipality. 21 These are all statutorily authorized. 22 Supervision by the director of all the 23 municipal officers and employees to the extent 24 that their duties relate to fiscal affairs of 25 the municipality. 0030 1 I think the direction is what Mr. 2 Cunningham suggested. 3 Supervision by the director of the revenue 4 administration. 5 For example, tax collection of the 6 municipality. We want to assure that all the 7 revenue that is collected, and the potential be 8 collected in a timely manner and that it is in 9 statutorily correct manner. 10 Appointment of a fiscal control officer, 11 authorization for the directives of assuming 12 the function of controller in the municipality, 13 singled by the director of all collective 14 bargaining agreements entered into by the 15 municipality. That doesn't mean that the state 16 will negotiate. It means you will negotiate 17 with final approval, and must come through the 18 Local Government Services Office. 19 This assures that there is transparency, 20 and also assures that all contracts are cost 21 effective, because I think it was first pointed 22 out there is a deficit, and it has to be

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23 filled. 24 This also includes all professional 25 services and consulting contracts as well. 0031 1 Approval by the Board of appointment or 2 dismissal of unclassified service in managerial 3 provisions necessary for the financial 4 rehabilitation of the municipality. 5 We will have state employees come in and 6 do the performance audits to make sure, and I 7 think Mr. Cunningham pointed out, that, on a 8 departmental level, there should be some kind 9 of review that impasses that review. 10 Authorization of the directive to fix the 11 hours and terms and conditions and employment 12 of all municipal employees, and authorization 13 to appoint business of municipal employees 14 subject to applicable civil service 15 requirements and selective bargaining 16 agreement. Other powers related to 17 liabilities, the study and evaluation of 18 cooperative agreements with other public 19 entities, the preparation of fiscal and special 20 reports and other provisions that deem 21 necessary to the fiscal control officer and the 22 director and the city under NJSA 52:27BD67 23 through 90. 24 Those are my recommendations. So, I would 25 like you, the Board, that the motion that we 0032 1 will vote on it, and we will look at any 2 comments from the Board. 3 COMMISSIONER TURNER: I just, like the 4 manager, there is one way comment. 5 I still get the sense that a lot of -- 6 there is no way that you can totally 7 restructure a municipality in one year. This 8 is one year. 9 You know, to run a municipality for many 10 new people takes a lot of time. 11 We are all here because a budget was not 12 adopted. There is a tremendous spillover from 13 the June 30th budget year, to the July 1 budget 14 year. 15 The first part we got from, both, the last 16 budget cycle, and then the second part of the

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17 adopting of the budget was you. You manage the 18 changes in a short period of time, in time to 19 adopt a budget. 20 So, this budget will be painful. Any 21 budget that this Board is faced with will be 22 painful. It is not the responsibility of the 23 state to restructure Hoboken , it is the 24 responsibilities of the elected officials to 25 restructure Hoboken . 0033 1 And pushing the responsibility that 2 Trenton will solve any problem is totally 3 unreal. This will be last year's budget fix; 4 this will be this year's budget fix and spill 5 over to the next budget in 12 months. 6 We will evaluate in 12 months. But if you 7 want to restructure Hoboken , go to work and 8 restructure Hoboken . 9 Nobody should be here. It is a waste of 10 time and energy. 11 Two months ago, nobody had a plan. 12 Everybody said two months ago, nobody had a 13 plan. Nobody had a plan, Trenton will adopt a 14 budget. Trenton adopted a timely budget. I 15 have been there; we have done it. It will give 16 you time to do long term structuring if you 17 choose to have it. 18 MADAME CHAIRWOMAN: Mr. Light. 19 COMMISSIONER LIGHT: I'm going to make a 20 motion, but before I do that, I don't think the 21 situation could change. And it is a sad 22 situation. 23 And all members that find themselves in 24 this frequent situation have money of the 25 governing body at both levels, served locally, 0034 1 served in the state level, and have had to 2 accept responsibilities and have all been able 3 to work with others, and the structures that 4 resulted along the peer level have involved 5 many management situations. 6 This said, the direction of us passing was 7 referred because of the ability of the 8 government body to manage their own affairs. A 9 sad state of affairs, but now it must be passed 10 on to the Local Government Services to account

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11 that responsibilities. 12 But with all of that, and unless you have 13 anything to say, Frank wants to speak. 14 COMMISSIONER BLEE: Thank you. 15 Even though the situation that we're in 16 today, I really see it as incomprehensible and 17 inexcusable. 18 As individuals, I have no question to 19 question your integrity. I am sure that you 20 are all upstanding individuals; I have Hoboken 21 in the highest regard, and you are trying to do 22 the best thing. 23 I just recently completed 17 years in 24 elected office, starting at the local level and 25 the state assembly. 0035 1 In addition to the last five or six years, 2 I teach a public policy course at Stockton 3 College. 4 And I always tell my students that, if you 5 ever intertwined public policy and politics, in 6 order to make some public policy at some point, 7 you have to cut the ties to the politics. 8 And I don't know if we're talking 9 Democrat, Republican, Liberal, Conservative 10 here today, but what you got is, you've mired 11 the public policy process in politics, whether 12 be personal or whatever reasons, and that is 13 wrong and that is ashame. 14 Now, I'm not going to get on my soapbox 15 and preach, because a few years ago, I was in 16 state legislature, because of politics, 17 whatever the politics trend was, we shut down 18 the state of New Jersey for 10 days. That was 19 incomprehensible, and that was inexcusable as 20 well. 21 But at the end of the day, for whatever 22 reasons, whether you're going back a couple of 23 years ago, you're talking about this situation, 24 real people. And on a personal, individual 25 basis, are hurt by the actions or inactions of 0036 1 these elected officials. 2 So, I actually, positively support what 3 the Board is going to do today with this 4 recommendation that Mr. Light is about to make.

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5 And I hope that this will setup a 6 situation in which all these problems can be 7 rectified. I felt that from each and every one 8 of you, that you are going to embrace this in a 9 positive way, and then move forward, because I 10 think Hoboken is a tremendous city, you have 11 incredible potential, and hopefully by working 12 together, working with the state appointed 13 monitor, we can get this situation back the way 14 it should be and, hopefully, you know, we will 15 never see each other again, unless we are 16 watching on TV, getting accolades of being a 17 great place. 18 So, with that, Mr. Light, if you make a 19 motion -- 20 COMMISSIONER DELGADO: I wanted to say 21 that, and I think that in this whole situation, 22 even though a lot of people are here today and 23 that they are doing their best to represent the 24 City of Hoboken , I think that everybody needs 25 to put their feelings aside and really remember 0037 1 who elected you into office, were the citizens 2 of Hoboken . And that is important right now. 3 Sometimes you have to learn how to give 4 and take. And it is not about you fighting the 5 government body. And I really think that at 6 the end of the day, when you go back, you still 7 have a city to run. 8 And I think that each and every one of the 9 governing body really needs the governing body 10 because, like my colleague said, you're only 11 hurting the citizens of Hoboken at the end of 12 the day. 13 COMMISSIONER LIGHT: I am at a loss for 14 words after those words. 15 MADAME CHAIRWOMAN: Do we have a motion? 16 COMMISSIONER LIGHT: Yes. I will make a 17 motion that we approve the regulation of the 18 director. 19 COMMISSIONER DELGADO: I will second it. 20 MADAME CHAIRWOMAN: Questions from the 21 commissioners? 22 (No response.) 23 MADAME CHAIRWOMAN: Okay. Roll call. 24 MS. McNAMARA: Miss Jacobucci?

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25 MADAME CHAIRWOMAN: Yes. And I hope that 0038 1 I don't see you again. 2 MS. McNAMARA: Mr. Blee? 3 COMMISSIONER BLEE: Yes. 4 MS. McNAMARA: Miss Delgado? 5 COMMISSIONER DELGADO: Yes. 6 MS. McNAMARA: Mr. Light? 7 COMMISSIONER LIGHT: Yes. 8 MS. McNAMARA: Mr. Turner? 9 COMMISSIONER TURNER: Yes. 10 MADAME CHAIRWOMAN: And I also would like 11 to thank everyone for coming down. Thank you. 12 Okay. The new item on the agenda, that is 13 Middle Township . Okay.

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